New FSC organization to enhance MFI supervision

[Photo by MK DB]

South Korea’s Financial Services Commission (FSC) on Sunday unveiled a new organization within the financial authorities to enhance its supervision of mutual financial institutions (MFIs) such as MG Community Credit Cooperatives, the National Credit Union Federation of Korea (Shinhyup), and the National Agricultural Cooperative Federation (Nonghyup).

The new Mutual Finance Team will be created based on a ‘business agreement for strengthening the soundness supervision cooperation system for MG Community Credit Cooperatives’ signed with the Ministry of the Interior and Safety in February 2024.

The team will monitor loans in the mutual financial sector, including real estate and construction loans, and promote risk management such as the sale of non-performing loans and debt restructuring. It will also check the institutions’ ability to respond to emergencies such as liquidity problems.

The FSC will also form a Comprehensive Support Team to provide integrated support for financial, employment, and welfare services to vulnerable groups in collaboration with the Ministry of Employment and Labor as well as the Ministry of the Ministry of the Interior and Safety.